Since We've Been Gone...

We hope all of our readers had very happy holidays. Now that we are back from our vacation, there is a lot to report on regarding congressional actions right before the holidays, as well as expected actions once they return.

Debt Limit

On December 28 President Obama signed into law an increase to the debt ceiling, bringing the number up from $12.1 trillion to $12.39 trillion. This new limit passed the Senate just four days earlier by a vote of 60-39, with many Senators supporting the increase only after they were promised a debate in late January over the possibility of creating an independent and bipartisan commission to make recommendations on spending, taxes, and deficit reduction. The increase to the debt limit bought the Treasury two months of funding government operations, before the limit will need to be revisited again. Congress is expected to take up the issue shortly after reconvening on January 19. The Senate will consider a longer term debt bill – HJ Res 45, which has been passed by the House – along with several other amendments. These amendments will likely include consideration of pay-as-you-go budgeting rules, a proposal to bar the spending of extra TARP funds, and a possible proposal for the regulation of greenhouse gases. As for the debt ceiling itself, while the House version includes an increase to $13.029 trillion, it is unknown at this point how large of an increase Harry Reid will propose at this time.

Health Care

Senate Democrats also passed their health care overhaul bill December 24. Negotiations with the House on a final bill are still to come (the House returns on January 12, the Senate on January 19). One of the biggest areas of contention is how the House and Senate will each go about funding their bills; with the Senate including a tax on high-end insurance plans and the House supporting a new surtax on millionaires.

CRFB has updated our comparison chart outlining the ten-year costs of the major provisions in both the House and the Senate bills. We have also created a number of sharable graphs that can be seen in this blog post. The one below shows the change in federal budgetary commitment to health care.

(We encourage you to share this graph, but please link to us.)

Defense Bill

The Defense spending bill for FY 2010 provides $636 billion in discretionary spending for regular activities and war operations. It is $11 billion greater than last year’s total. The bill included some short-term extensions of federal unemployment benefits, as well as other non-military programs. Included in the Defense package was an extension, through February 2010, of existing unemployment and COBRA provisions.

The defense bill included a number of temporary measures that Congress was not able to fully address. These include:

• COBRA: President Obama signed the bill temporarily extending COBRA through February 28, 2010. The COBRA subsidy program extension included in the 2010 Defense bill will expand the amount of time people can get the subsidy from 9 - 15 months, extend the eligibility period for premium reduction for two months, and give credit against future payments to people who paid the full premium in December.
• Small Business Loans: The bill allows the SBA to continue two temporary enhancements to its loan guarantee program through February 28. It is fully offset.
• Patriot Act: Extends authorizations of the act through February 2010.
• Flood Insurance: Extends through February 2010.
• Medicare Physician Payments Extension: Delays through February 2010 a 21.2% cut to payments. The delay is fully offset.
• Surface Transportation Authorization Extension: Extends the authorization for the highway, transit, highway safety and motor carrier safety programs through February 2010.
• Unemployment Insurance: Extends expanded benefits through February 2010.
• Satellite Television Extension and Localism: This bill fully offsets the extension of a copyright license used by satellite television producers, through February 2010.
• Nutrition Assistance: The Supplemental Nutrition Assistance Program (SNAP) increased participation by 18% in the last year. This bill includes language ensuring it will have sufficient funding to meet the growing demand for nutrition assistance from modest-income families.
• Assistance Eligibility: Maintains HHS administered poverty guidelines at current levels through February 28, 2010.

Jobs Bill

Before leaving town for the holidays, the House passed a $150 billion jobs bill which the Senate did not have time to consider. About half of the bill -- $75 billion -- would be financed with leftover funds from TARP. It would $39.3 billion toward highways, transit, and HUD, $40 billion toward assistance for unemployed workers, and $2.8 billion for clean-water infrastructure. The jobs bill also extends unemployment benefits and health care subsidies for laid-off workers under COBRA for six months.

The bill still has to be considered in the Senate. CBO's cost estimate of the Jobs for Main Street Act can be seen here.

Non-Defense Appropriations Bills

On December 16 President Obama signed into law a $447 billion omnibus measure that provided spending on a number of appropriations bills through FY 2010. The bill provided spending for he Departments of Commerce, Defense, Education, HHS, HUD, Justice, Labor, State, Transportation, the Treasury, Veterans Affairs and other agencies. CRFB released a paper on controlling discretionary spending, pointing out:

"When added to the five already-passed bills, this minibus will put total non-stimulus, non-defense FY2010 appropriations at $583 billion. This represents an 8.2 percent increase over last year’s $539 billion."